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Denton County Realtor Aaron Layman

281-935-2889

"Could not have been more pleased with the entire process of selling my Katy house. Aaron was very professional and went out of his way to help kennel my dog before showings while I was at work. He had an outstanding knowledge of the entire real estate transaction process and was always very responsive to my questions. Would definitely recommend Mr. Layman to anyone I know!!"

Matt B., Home Seller

"Aaron helped us narrow down our choices and navigate the market. He is very knowledgeable about making a wise decision. He will help you find a house that you love and is a good financial decision."

Kristina R., Home Buyer

"Aaron was our realtor when we bought our house 13 years ago and he was our realtor when we sold our house in 2014. He is honest about the market and very helpful with all aspects of buying/selling a home. We would recommend him to anyone in need of realty services."

Paula O., Home Buyer & Seller

"We had several agents to choose from as we'd been in the area for several years. Aaron was an easy choice as he's knowledgeable and wasn't afraid to go after what's best for us, his clients! He kept us well informed throughout the process and was always prompt in answering questions from start to finish. We definitely recommend Aaron!"

Shanna K., Home Buyer

"Working with Aaron was the best decision we made when looking for a new home and selling our previous home. He is one of the most knowledgeable realtors in the area. He knows the numbers, the trends, and always has data to back up his recommendations and decisions. Likewise, he made the process simple and understandable at the same time. Aaron was always in our corner and always did his best to get the best outcome for us. I have recommended Aaron to many friends and family and would recommend him to anyone looking to buy or sell their home."

Shadow banks, or nonbanks as they are often called, continue to dominate the mortgage space in the real estate echo bubble. This is the case in Denton County Texas and all across the country. Since 2008 the share of mortgage originations by nonbanks has more than doubled, rising from 24% in 2008 to 54% in 0217. The share of mortgages issued by traditional large banks continue to decline.

As home prices rose throughout Denton County, the quality of the mortgages originated during this boom began deteriorating. Last year the deterioration in mortgage quality was pronounced. This is reminiscent of the last housing bust when borrowers were leveraging themselves to extremes to keep with up with rapidly rising home prices. The AEI Center on Housing Markets and Finance issued a detailed 184-page report on demonstrating how shadow banks have taken on increasing risks. The rising role of FHA-insured mortgages backstopping these increasingly risky loans certainly warrants concern.

The American Enterprise Institute report paints a rather bleak picture of home affordability in the United States. It also highlights how market share is shifting from banks to nonbanks due to the higher risk tolerance of nonbank lenders. Nonbanks virtually dominate the space for FHA purchase mortgages, with traditional large banks taking less than 10 percent of that business. More concerning is the deteriorating risk profile of these FHA-guaranteed mortgages…

The AEI also uses a National Mortgage Risk Index for mortgage default risk based on performance of older vintage loans. The NMRI shows a big jump in the stressed default rate of FHA-insured mortgages…

The debt-to-income DTI ratios of recent FHA loans are simply disturbing. More than half of the FHA-insured loans now carry DTI ratios exceeding the QM limit of 43%. Nearly half of VA mortgages also exceeded the QM limit.

Obviously these trends are not sustainable. The question is what can be done to solve the problem. AEI suggests we need accelerated household incomes or further increases in leverage if we are going to support the housing market. Unfortunately the Fed is adamantly opposed to wage inflation of any significance. Paying the slaves actual living wages is not part of the profit-driven business plan. Higher leverage is just another accident waiting to happen. Sadly it is the most vulnerable borrowers in the market who are most likely to leverage beyond their means in order to buy a home. There are some new home builders who cater to these types of vulnerable borrowers. The picture looks fine as long as home prices continue to rise. It’s only when the market turns south that we see the longer-term consequences of risky mortgage lending.

The listings on this site are for your personal, non-commercial use and may not be used for any purpose other than to identify prospective properties you may be interested in purchasing. Display of MLS data is usually deemed reliable but is NOT guaranteed accurate by the MLS. Buyers are responsible for verifying the accuracy of all information and should investigate the data themselves or retain appropriate professionals. Information from sources other than the Listing Agent may have been included in the MLS data. Unless otherwise specified in writing, Broker/Agent has not and will not verify any information obtained from other sources. The Broker/Agent providing the information contained herein may or may not have been the Listing and/or Selling Agent.